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An autocratic city-state that has become a leading manufacturing and financial centre

Singapore lies at the tip of the Malay peninsula, occupying the island of Singapore, along with 60 other adjacent islets. The city covers the southern part of the main island, but has extended itself further so that there is now little distinction between the city and the countryside. There is a small, highly productive agricultural sector but this is essentially an urban environment.

Singapore has a diverse immigrant-based population. The majority are of Chinese origin, though since they come from a range of provinces they often speak different dialects. The Indian population is also disparate, including Tamils, Malayalis, and Sikhs. The Malay population is linguistically more uniform. But most Singaporeans are at least bilingual and also speak English, the language of government and business. Racial tensions, although muted, persist.

Singapore's rapid development has also created labour shortages—at both the bottom and the top of the market. More than one-quarter of the resident population are migrants. This includes 140,000 foreign maids as well as 300,000 foreign professionals. The government has a well-organized system for controlling this workforce, involving special levies on employers.

Singapore has now attained first-world status. Standards of education and health are good. The education system is highly competitive, with a strong emphasis on the literacy and numeracy requirements of a modern economy—though there are worries that regimented instruction is producing workers who are not sufficiently creative.

Most of these workers are employed in manufacturing and services. Singapore has for a century or more been an important regional centre for trade and business, and since the early 1960s the government has relentlessly propelled the economy along a path of export-led growth.

Manufacturing accounts for one quarter of GDP, around half of which comprises electronics: Singapore was the world's leading producer of computer disk drives but is now moving more into integrated circuits.

Since the early 1970s, Singapore has become one of the world's largest oil-refining centres—based on imported crude oil—and is a significant producer of chemicals and pharmaceuticals. It is also a centre for high-quality printing and publishing. Most of this activity is in the hands of 5,000 or so international companies along with a few large local enterprises.

A further one-quarter of GDP comprises finance and business services. Singapore's strong financial services sector combines a protected local banking system, dominated by four domestic banks, with a more open offshore banking sector. All are closely regulated.

Hectic construction of soulless apartments

Singapore's development has demanded a hectic process of construction. Until the mid-1980s this largely meant razing slums and replacing them with soulless apartment blocks and skyscrapers. More recently there have been attempts to preserve older buildings. High urban density has also created serious environmental problems, particularly from the automobile. In response, the government applies a sophisticated electronically monitored system of road pricing, along with a good network of public transport. One persistent problem is a shortage of water, which has to be piped from Malaysia.

This frantic expansion has been directed by an autocratic government. For two years following independence in 1963, Singapore was part of the Malaysian Federation, but it broke away in 1965 to become an independent country.